In an open economy in which only two goods are produced and possibly traded, we would find that
a. production occurs where the production possibility curve is tangent to a line with the slope equal to the ratio of the world relative prices.
b. production occurs where an indifference curve is tangent to the production possibilities curve.
c. consumption occurs where an indifference curve is tangent to the production possibilities curve.
d. consumption occurs where the production possibilities curve is tangent to a line with a slope equal to the ratio of the world relative prices.
a. production occurs where the production possibility curve is tangent to a line with the slope equal to the ratio of the world relative prices.
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The federal budget is decided upon by the
A) President of the United States and the United States Treasury. B) the United States Treasury alone. C) President of the United States and the United States Congress. D) President of the United States and the Federal Reserve system. E) United States Congress and the Federal Reserve System.
$100 is to be divided among two individuals—Mary and Jenna. Which of the following allocations is Pareto efficient?
A) Mary receives $45, and Jenna receives $45. B) Mary receives $20, and Jenna receives $75. C) Mary receives $1, and Jenna receives $99. D) Mary receives $90, and Jenna receives $9.
Classical economists reject the laissez-faire theory that the economy would self correct to full employment without government interference
a. True b. False Indicate whether the statement is true or false
The new $20 bills are being introduced by the U.S. Treasury primarily to diminish
A. inflation. B. poverty. C. counterfeiting. D. bank failures.